Calculate your risk reward and position sizing in leveraged trading.
Calculate your risk reward and position sizing in leveraged trading.
Here you can add some frequently asked questions and their answers to help users understand how to use the calculator better.
Risk per trade refers to the amount of risk that you are willing to take on any single trade. This is often expressed as a percentage of your total trading capital. For example, if you have $10,000 in your trading account and you are willing to risk 2% per trade, your risk per trade would be $200.
The entry price is the price at which you enter the trade. This could be the current market price or a predetermined price based on your trading strategy.
A stop loss is an order to sell a security when it reaches a certain price. It is designed to limit an investor’s loss on a position in a security. For example, setting a stop loss order for 10% below the price at which you bought the stock will limit your loss to 10%.
Leverage refers to the use of borrowed money to increase the potential return of an investment. In trading, it allows you to open a position that is larger than the capital you have in your account. However, it also increases the potential for higher losses.
The account size refers to the total amount of money in your trading account. This includes the money you have deposited as well as any profits or losses from your trades.
The position size is calculated based on your risk per trade, the entry price, the stop loss, and the leverage. It is the amount of the security that you should buy or sell in order to stay within your risk parameters.
The risk per share is the difference between the entry price and the stop loss price. It represents the amount you stand to lose per share if the price moves against you to your stop loss.
The target price is the price at which you plan to sell the security to make a profit. It is calculated based on your trading strategy and risk-reward ratio.